JGBS: Massive Rally As Nikkei Tanks, BOJ Ueda Speech Tomorrow

"*JAPAN PRELIM AUG. LEADING INDEX 118.0
(prior 117.6)
*JAPAN PRELIM AUG. COINCIDENT INDEX 118.7" - BBG
(prior 120.6)

Yesterday's positivity couldn't be sustained with falls across most major equity markets today.  Despite the positive lead in from Wall Street, profit takers took over, seeking to lock in yesterday's gains as Brent steadily moved higher due to escalating Saudi-Houthi tensions and an approaching storm in the Gulf of Mexico) and stubbornly elevated 10-year US Treasury yields were in focus.  

Profit takers too dragged the KOSPI lower as investors are moving cautiously into cash ahead of highly anticipated tech earnings later this month. Tech bellwethers led the decline, with SK Hynix sliding over -1.6% whilst Samsung held on to modest gains of +0.15% ahead of results tomorrow which is expected to see a chip operating profits up.

The NIKKEI is down -0.71% with most market commentators suggesting profit-taking was the primary driver following a powerful preceding rally. Sentiment was constrained by a weakening Japanese Yen and the broad regional anxiety over surging energy import bills triggered by the spike in global oil prices.

The Reserve Bank of India has raised rates in line with expectations and the NIFTY 50 is down -0.70%.  The Indian market snapped a consecutive two-day of gains ahead of the decision with the rise in oil prices not helping sentiment.  The RBI has left the door open for further rate rises, taking rate cuts off the table.  

Despite tracking Wall Street higher at the opening bell, Malaysia's KLCI index quickly dipped into the red due to foreign fund selling targeted at large-cap financial heavyweights like CIMB and Hong Leong Bank as JP Morgan downgraded CIMB's outlook. However, the broader market remained remarkably resilient, with smaller-cap gainers outpacing decliners and minor support pouring into local oil & gas counters via the rising energy sector

"*TAKAICHI: CONSUMPTION TAX CUT, HANDOUTS ARE BEST OPTION" - BBG